Digitalisation into the future
Digitalisation is set to change how businesses operate for the better. These changes span industries. Within the healthcare space, digitalisation will connect rural patients who have been diagnosed with chronic diseases to doctors, without them ever having to leave their homes. In education, digitalisation will see children in the most remote classrooms being taught by the best teachers in the country and experiencing lessons in real-time, via HD video links. Security and crime-prevention initiatives will be boosted through a range of facial recognition, big data analytics and mobile technologies. Likewise, we'll be better equipped to save energy as street lights are fitted with intelligent sensors, so they can be dimmed or brightened based on need.
For Cathy Smith, MD for Cisco Southern Africa, digitalisation means connecting people and things, and making sense of the data we generate in a meaningful and secure way. In 2016, says Smith, we've seen breakthroughs such as a rise in the adoption of cloud models, the hyper-personalised shopping experience, the tech-savvy bank of the future, as well as the re-imagination of the mobile workforce. "There is no denying the eminent digital rupture."
While the term `digitalisation' is often used in reference to things like automation, process efficiency or paperless environments, Mpumi Nhlapo, head of solutions and demand delivery at T-Systems SA, believes that true digitalisation actually describes something far grander. It's the application of technology to create entirely new customer value and develop new business ecosystems.
But technology transformation in isolation rarely succeeds, notes Jon Tullett, research manager at the International Data Corporation (IDC) Sub-Saharan Africa. In fact, the IDC forecasts that 80% of siloed digital transformation projects will fail. Tullett believes digitalisation needs to be aligned with the broader digital transformation of business processes.
Prof. Barry Dwolatzky, director of the JCSE and founder of Tshimologong Precinct, cautions that businesses should be strategic when making the move to fully embrace digitalisation. "I think the key message is that businesses must carefully design and plan digitalisation. These changes come with huge business risks and shouldn't be rushed into."
The local landscape
Currently, only two percent of Africa's economy is composed of internet-related services, but this figure is expected to grow to seven percent, or $315 billion, come 2025, says Nhlapo. He adds that there are already a number of great examples of local companies born out of digitalisation. Kenya's Twiga Foods, for instance, connects farmers with local store owners within a digital marketplace. The mobile supply platform integrates informal delivery networks and mobile money platforms to facilitate the sale of fresh produce, alleviating food shortages and price volatility of local produce. Nhlapo says a service like Twiga Foods would not exist had Kenya not truly embraced digitalisation and mobile technology.
Looking at South Africa, Smith says the country faces a few fundamental challenges that need to be overcome before businesses can fully embrace digitalisation. "Traditional methods of rolling out ICTs that have worked in other, more developed economies are not necessarily suited to South African needs. We need a new approach that prioritises collaboration to open the country up to digital inclusion and opportunity." The Internet of things (IoT) should be part of every business discussion as digital transformation can drive operational efficiency, increase employee productivity, garner greater customer loyalty and create new revenue streams, she continues. "To fully digitalise takes imagination, investment and expertise."
To fully digitalise takes imagination, investment and expertise.Cathy Smith, Cisco Southern Africa
South African CIOs are commonly hindered by economic constraints, but when digitalisation is the objective, this makes their job exceedingly difficult, says Yaron Assabi, CEO of Digital Solutions Group. Unfortunately, a business strategy that does not see the value of allocating sufficient budget to innovation and technology fails to align with the general shift in focus towards deriving and delivering an increase in revenue and margin through an effective digitalisation strategy. "Therefore, technological innovation must be high on the agenda for every C-level exec and they need to always be working closely with the CIO to understand digital strategy."
The digitalised customer
Digitalisation is not only about improving what businesses do with technology - streamlining processes, making the business more efficient and cost-effective - it's about fundamentally changing businesses through the adoption and use of technology, says Assabi. This can change the nature of competition in a particular industry and, in some cases, create new industries. Digitalisation often alters the way businesses interact with their customers or how they are able to create a unique value proposition to their customers using technology, he adds.
Tullett shares this sentiment. A primary driver of digitalisation is user experience, he says, adding that this trend is propelled by changes in customer expectations and also driven, albeit to a lesser extent, by internal users. "Again, the technology in itself is only symptomatic. For example, Uber customers expect a certain experience consisting of fast, cheap, reliable transportation. The smartphone app and cloud back-end used for Uber are only ingredients in achieving that experience." In this way, digitalisation has also transformed customers and has promoted the maturation of customer expectations.
...technological innovation must be high on the agenda for every C-level exec and they need to always be working closely with the CIO to understand digital strategy.Yaron Assabi, Digital Solutions Group
Customers have become for more comfortable with digital technology and content, says Dwolatzky, and their expectations have shifted because of their exposure to well-designed, high-quality apps and other solutions. "Consumers are much less tolerant of poorly designed and 'bug-ridden' software. Solutions need to look good and work well. The quality bar has most certainly been raised."
Andre Witte, Nebula CTO, says the digital customer expects a seamless integration between their online and offline engagements and they demand constant visibility, "whether it is tracking an online order, viewing in-store account purchases online, or monitoring investments through an online portal. By offering this kind of transparency and awareness, businesses can increase customer loyalty and create a trusting relationship between the business and its customers."
As for the future of digitalisation, Witte forecasts an exciting period to come. He believes we will experience an increase in media convergence, which will see users expecting richer experiences via the same devices. He adds that the future of digitalisation will bring about a greater focus on tracking and visibility into each customer interaction from both the business and the customer perspective. Data will remain a critical asset as companies implement systems that can import and visualise big data and there will be an increased dependence on predictive analytics as companies seek to make more accurate decisions based on facts and statistics derived from customer information.
"When it comes to ordinary consumers, in 2017, connected devices will move from the realm of talk into actual consumer offerings. Apparel companies will bring smart clothing into the mainstream. Wearable fitness and health devices will gain in popularity. More of us will start measuring the quality of our sleep, the performance of our cars, the temperature in our houses, and much more," notes Nhlapo.
"These will begin in a fairly isolated way, but will set the tone for a future where platforms become more consolidated and standardised and our smart devices start to become more integrated with each other than they have ever been in the past."
The case for connectivity, access
The South African government has identified the ICT industry as one of the key sectors that will facilitate faster economic growth and radically transform our society. "But with digitalisation come many changes and adjustments," notes Riaan Graham, sales director for Ruckus Wireless Sub-Saharan Africa.
Global and local research illustrates that SA is missing out on growth opportunities because of shortfalls such as low internet penetration, high costs and unimpressive download speeds - which also means we are missing out on digitalisation. "The push towards digitalisation also means that WiFi connectivity has an important role to play in future connected cities. It also means we need to start thinking about connectivity in different ways if we are to truly take advantage of digitalisation."
While Graham is confident that we are headed in the right direction, he stresses that there is still work to be done. "By 2020, it is estimated that an entire generation will have grown up in a digital world, which means their reliance on technology and their desire to be connected will transform and digitise the environment even further. We need the infrastructure to ensure that this can take place."
Aligning a business and a human strategy
The rapid pace of digital innovation and the increasing ubiquity of digital devices have caused a drastic increase in the use of digital technology for a number of tasks throughout every aspect of business and society. For Nebula CTO Andre Witte, the impact on business has been on two levels: technology and people.
On a technology level, it has enabled companies to create a one-to-one customer experience by moving away from a one-size-fits-all approach to a personalised customer journey. Witte cites the financial industry as a great example of how services have converged as customers can now use features such Facebook or WeChat banking. "It essentially becomes a full personalised engagement."
On a people level, companies are required to have a comprehensive human strategy in place to manage the entire change process of new technologies being implemented. These strategies cannot be implemented on a surface level; they must be company-wide initiatives that are deeply rooted in corporate culture.